Monique Ryan (Kooyong, Independent) Share this | Hansard source

I commend the government for moving to improve affordability of electric vehicles via the Treasury Laws Amendment (Electric Car Discount) Bill 2022. Electric vehicles are at the forefront of a major transformation of the world's transport sector. Widespread use of EVs in the Australian transportation fleet will deliver significant economic, environmental and health benefits to Australian consumers and to our society. It will also create new opportunities for Australian industry.

Global EV sales are growing rapidly, driven by government policy and large consumer markets in Europe, Asia and North America. EV uptake in Australia has previously lagged behind that of comparable countries due to a lack of support from Australian governments. The greater cost of EVs, concerns about driving range, deficiencies in our recharging infrastructure and limited range of available models have all been key factors hindering uptake of EVs in this country.

The No. 1 barrier to transport electrification in Australia is the poor supply of EV models across all vehicle segments. There are hundreds of EV models available overseas. Only a small fraction of those cars are being supplied to Australia. This supply issue has been policy driven. It has been due to Australia's lack of fuel efficiency standards and of any other supply policies, such as sales mandates. To achieve net zero, Australia needs to significantly increase its EV uptake. This will only be achieved through increased supply.

There are many ways to increase EV uptake in this country. The Albanese government policies being announced today and debated in this chamber are a step in the right direction, but only a small step. We need to support Australian manufacturers in engaging with EV component manufacturing and assembly. New industries such as charging-infrastructure manufacture and installation; battery manufacturing, recycling, repurposing and related mining and processing activities; and EV research and development are emerging as growth sectors for the Australian economy.

We would benefit from clarity regarding EV sales targets, which would deliver certainty to businesses and to consumers. This government should set EV targets for the Australian government fleet. It should work with state and local governments to coordinate fleet procurement. It should partner with businesses to manage and facilitate the rollout of charging infrastructure, to establish consistent national standards and to ensure that all new building developments and our electricity grid are EV charger ready. This government should help industry to develop its domestic EV manufacturing and supply, and its value chain capabilities. The bill presented today removes the five per cent import tariff on some imported EVs and the 47 per cent fringe benefits tax on electric cars provided by employers. While these steps will make EVs more affordable, growing sales and long waiting lists for EVs in Australia have long demonstrated that our EV uptake is limited not by consumer demand but by supply constraints.

How can we address those supply constraints? Fuel efficiency standards are used to regulate the average carbon dioxide emissions of manufacturers' fleets. They serve to reduce both fuel consumption and carbon dioxide emissions. They've been adopted in most countries worldwide. Australia, Turkey, Indonesia and Russia are the only G20 countries with no mandatory standards for fuel efficiency. Put simply, this means that manufacturers have no incentive to put their best cars on our market. We've become a dumping ground for vehicles that fail to meet efficiency and emission standards in Europe, the US and Asia. We get the cars no-one else will take, because our governments have never previously moved to set fuel efficiency standards—and related fuel quality and vehicle emission standards—comparable with other major markets around the world. Fuel efficiency standards will incentivise manufacturers to bring their low- and zero-emissions vehicles to Australia, and will penalise them for failing to do so. Adopting fuel efficiency standards will open the Australian market to EVs.

What else will it do? It will save us money. Modelling has shown that legislating targets for fuel efficiency for vehicles sold in Australia will save us money. The average car user in Australia will save between $237 and $519 a year from using less petrol. Those calculations were based on a fuel cost of about $1.30 a litre—much, much less than the current price of petrol. And that did not include the additional $140 per vehicle per year of healthcare costs related to vehicular pollution.

Addressing supply constraints with fuel efficiency standards will also reduce our greenhouse gas emissions. Emissions from passenger and light vehicles represent 57 million tonnes—10 per cent of Australia's total carbon emissions. There are about 24 million cars on Australian roads, and less than one per cent are electric. The average car sold in Australia stays on our roads for 15 years. Electrified transport can be powered by renewable energy. The zero emissions from running these vehicles will decrease our carbon emissions by 10 per cent.

Australia has the dirtiest petrol in the OECD. Every year in Australia, more people die from respiratory diseases related to vehicular pollution than from road traffic accidents. Transitioning away from internal combustion engine vehicles will improve our air quality. It will reduce pollution related diseases and improve our health. The price of petrol has skyrocketed. We've all felt the pinch from that in the last 12 months. Australia has only two fuel refineries. We've struggled in recent years to comply with the International Energy Agency's minimal stock-holding requirements for liquid fuels. Boosting EV uptake and investing in renewables will help address our fuel insecurity. It will reduce our reliance on imported fuel. Cars like the Ford F-150 Lightning can tow up to 2,000 kilograms. They can work as a mobile generator for tradies. They can power our homes. They are enormous mobile batteries with a free car thrown in. They won't kill our weekend, but they will slay in the camping ground.

In the short term, we need our government to shape the direction in which our EV market is moving. The Albanese government has to introduce robust fuel efficiency standards equivalent to global best standards. These will cost us nothing, but they will ensure that manufacturers supply a greater range of affordable EVs to our market, rather than offering us only polluting internal combustion engine vehicles that no-one else wants and the luxury end of the EV market. The government has signalled that it intends to canvass the community regarding fuel efficiency standards. It needs to do more than that; it needs to act. Yes, we also need expanded charging facilities. Yes, our corporate and government fleets should commit to large-scale EV purchases, increasing the supply of second-hand vehicle in this country in the second half of this decade. Yes, we need package incentives. Yes, we need better vehicle emission standards for non carbon dioxide emissions, which will also have implications for our health. Each of these steps will contribute to our move to cleaner, healthier transport options.

Anyone interested in an immediate decrease in our carbon emissions achievable by rapid electrification of our transport system will welcome the bill that we're debating today, but these changes are only baby steps. The FBT scheme has been costed at only $20 million for the first year, implying that the scheme will benefit only around 2,000 vehicle owners. The fringe benefit tax is available only to employees who have the ability to salary sacrifice; it's not available to all people looking to buy a new car. The FBT saving applies only to those cars priced below the luxury car tax threshold for fuel-efficient vehicles, which this year is $84,000-plus. It excludes more expensive EV models which constitute a very significant part of the existing EV market in this country, and it has no immediate impact on the second-hand car market in this country.

The next move for this government must be the immediate setting of international best practice fuel efficiency standards to improve our health and improve the quality and range of cars offered for sale into this country. We need ambition and vision from this new government, and we need it now.

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